If the government plans to boost employment through expansionary fiscal policy beyond the natural rate of...
If the government plans to boost employment through expansionary
fiscal policy beyond the natural rate of unemployment, show this
effort in an AD-AS diagram.
What is the short-run equilibrium under the assumption of rational
expectations?
Homework Answers
Add Answer to:
If the government plans to boost employment through expansionary
fiscal policy beyond the natural rate of...
According to the rational expectations model, the attempt by the government to reduce unemployment below its...
According to the rational expectations model, the attempt by the government to reduce unemployment below its natural rate through expansionary policies will succeed in the short run and can succeed in the long run as long as the government makes it clear what its goals are. succeed because the government knows how people will react to their policies and will adjust their policies accordingly fail because people will figure out what the government is doing and alter their expectations and...
According to adaptive expectations theory, expansionary monetary and fiscal policies to reduce the unemployment rate are...
According to adaptive expectations theory, expansionary monetary and fiscal policies to reduce the unemployment rate are O useless in the long run. O useless in the short run O ineffective on the price level O None of these. QUESTION 4 1 points Save According to the Phillips curve, a more expansionary macro-policy that causes inflation to be greater will: O place downward pressure on prices. O reduce unemployment. O reduce output O reduce the natural rate of unemployment. 1 pointsS...
FISCAL POLICY IN-CLASS WORKSHEET 2 This question explores the role of expansionary and contractionary fiscal policy...
FISCAL POLICY IN-CLASS WORKSHEET 2 This question explores the role of expansionary and contractionary fiscal policy in the Aggregate Demand and Aggregate Supply model. You will use schedules for an aggregate demand line and an aggregate supply line to identify the equilibrium price level and real GDP in a macroeconomy. Additionally, you will compare the short-run equilibrium level of real GDP to the full employment level of real GDP to identify desirable fiscal policies. Below, you are provided the schedules...
Refer to the above diagram, in which Qf is the full-employment output. An expansionary fiscal policy...
Refer to the above diagram, in which Qf is the
full-employment output. An expansionary fiscal policy would be most
appropriate if the economy's present aggregate demand curve were
at:
Question 3 options:
AD0.
AD2.
AD3.
None of these.
AD3 AS AD AD, AD C3 Real GDP
Compare the effects of an expansionary fiscal policy action—an increase in government spending financed by government...
Compare the effects of an expansionary fiscal policy action—an increase in government spending financed by government bond sales to the public, for example—in the Keynesian and classical models. Include in your answer the effects of this policy shift on the level of real income, employment, the price level, and the rate of interest.
Should the government use monetary and fiscal policy in an effort to stabilize the economy?
7. Use of discretionary policy to stabilize the economy Should the government use monetary and fiscal policy in an effort to stabilize the economy? The following questions address the issue of how monetary and fiscal policies affect the economy, and the pros and cons of using these tools to combat economic fluctuations. The following graph shows a hypothetical aggregate demand curve (AD), short-run aggregate supply curve (AS), and long-run aggregate supply curve (LRAS) for the U.S. economy in April 2020. Suppose the government...
1.In the neoclassical view of the economy, expansionary fiscal policy cannot work to raise equilibrium output...
1.In the neoclassical view of the economy, expansionary fiscal policy cannot work to raise equilibrium output because it will raise unemployment. it will disincentivize production. flexible prices will eventually choke off any increase in aggregate demand. 2.Autonomous expenditure does NOT depend on what factor? Consumer spending Future expectations GDP/output 3. Each of the following statements are about government spending as function of national income. Which one of the statements is a false statement? On a Keynesian cross diagram the government...
3.The Multiplier and returning the economy to Equilibrium a. List expansionary and contractionary tools of fiscal...
3.The Multiplier and returning the economy to Equilibrium a. List expansionary and contractionary tools of fiscal policy b. Assume C=$12,300 +.6 Dl and graph an economy in the AD AS model with Potential Output of $600 and Real GDP at $450. Identify typical levels of unemployment and inventory change in this gap. c. Calculate the change in unemployment insurance needed to close the gap. Show all work d. Assume government spending changes by $50, what is the impact on AD?
If the economy is at the natural rate of unemployment with the level of real GDP...
If the economy is at the natural rate of unemployment with the level of real GDP at potential output, what would expansionary fiscal or monetary policy do to the economy? How would the economy be effected in the short run and long run? Does the Phillips Curve theory explain what happens?
32. The rational expectations hypotheses implies that discretionary macroeconomic policy is: a. relatively effective in both...
32. The rational expectations hypotheses implies that discretionary macroeconomic policy is: a. relatively effective in both the short run and long run b. relatively effective in the short run but ineffective in the long run c. relatively ineffective in both the short run and long run d. effective in the long run since decision makers will continually make predictable, systematic errors 33. The modern view of the Phillips curve suggests that a. when inflation is less than anticipated, unemployment will...
According to adaptive expectations theory, expansionary monetary and fiscal policies to reduce the unemployment rate are O useless in the long run. O useless in the short run O ineffective on the price level O None of these. QUESTION 4 1 points Save According to the Phillips curve, a more expansionary macro-policy that causes inflation to be greater will: O place downward pressure on prices. O reduce unemployment. O reduce output O reduce the natural rate of unemployment. 1 pointsS...
Refer to the above diagram, in which Qf is the
full-employment output. An expansionary fiscal policy would be most
appropriate if the economy's present aggregate demand curve were
at:
Question 3 options:
AD0.
AD2.
AD3.
None of these.
AD3 AS AD AD, AD C3 Real GDP
3.The Multiplier and returning the economy to Equilibrium a. List expansionary and contractionary tools of fiscal policy b. Assume C=$12,300 +.6 Dl and graph an economy in the AD AS model with Potential Output of $600 and Real GDP at $450. Identify typical levels of unemployment and inventory change in this gap. c. Calculate the change in unemployment insurance needed to close the gap. Show all work d. Assume government spending changes by $50, what is the impact on AD?
Most questions answered within 3 hours.
-
A survey of tobacco use in high schools tested the saliva of
female and male students...
asked 13 minutes ago -
Assume that the mutation rate for a given gene is
510-6 mutations per gene per generation....
asked 12 minutes ago -
The majority of innovation organizational communication has
been driven by technological advancements in the past thirty...
asked 12 minutes ago -
If one motor has three times as much power as another, then the
smaller power motor:...
asked 11 minutes ago -
Discuss at least four issues that are important to
accountants.
I need 2 pages of explanations
asked 11 minutes ago -
a crate of apples with a mass of 24.8 kg is on a ramp with angle...
asked 20 minutes ago -
In 2014, Damian Walters demonstrated that he could run through a
vertical loop (after a lot...
asked 20 minutes ago -
Which one is better to use to extract beta-carotene from carrot
acetone or ethanol? is there...
asked 24 minutes ago -
discuss guidelines for using punishment wisely and why using
punishment can become “habit-forming”
asked 45 minutes ago -
2 The goal of
a _______________________________________ is to estimate
the profit potential of an product at an...
asked 29 minutes ago -
Is the dissolution of the salt A(OH)2 a reaction that increases
the disorder, or decreases the...
asked 43 minutes ago -
Do a five force analysis of the personal computer industry. Why
did Apple struggle historically in...
asked 36 minutes ago